Method and apparatus for preauthorizing electronic fund transfers without actual written authentication

• US 7,440,923 B1
• Filed: 05/24/1999
• Issued: 10/21/2008
• Est. Priority Date: 05/24/1999
• Status: Expired due to Term

• Current Assignee: Paymap, Inc. (Western Union)
• Original Assignee: Western Union
• Inventors: Compiano, Craig M.
• Primary Examiner(s): Oyebisi; Ojo O
• Application Number:
  US09/317,785
• Time in Patent Office: 3,438 Days
• Field of Search: 705 39- 44, 705/35, 705/36, 705/38, 705/10, 705/14
• US Class Current: 705/44
• CPC Class Codes: G06Q 20/40 Authorisation, e.g. identification of payer or payee, verification of customer or shop credentials; Review and approval of payers, e.g. check credit lines or negative lists
• CPC Class Codes: G06Q 30/02 Marketing; Price estimation or determination; Fundraising
• CPC Class Codes: G06Q 40/00 Finance; Insurance; Tax strategies; Processing of corporate or income taxes

Abstract

A method and apparatus for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from the consumer is implemented in connection with a direct marketing strategy for a financial product which, in the presently preferred embodiment of the invention, is a mortgage acceleration program. The invention provides for the mailing of a solicitation to a consumer, i.e. a prospective customer, based upon such factors as mortgage data that the financial institution may posses concerning the consumer. The mailing includes an authorization and passcode which, in the presently preferred embodiment of the invention, is an ACH authorization and passcode. When the consumer receives the solicitation, he may decide to enroll in the mortgage acceleration program. The consumer places a telephone call to a telemarketing organization at a telephone number that accompanied the solicitation. The consumer provides the passcode to a representative of the telemarketing organization and the telemarketing organization attempts to verify the passcode. If the passcode is successfully verified, then the consumer is enrolled in the mortgage acceleration program. Thus, the invention provides a deceptively simple and specific implementation of the “similarly authenticated” requirement of the EFTA that is applicable to direct marketing solicitations made by, or on behalf of, financial institutions. That is, the passcode provided by the consumer meets the requirement of a “digital signature or other code.” Yet, the consumer is not required to provide an actual written signature, nor is the consumer required to use a computer or other electronic means to conclude the transaction.

Claims

1. A method for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from said consumer, comprising the steps of:

mailing a printed solicitation to a pre-selected consumer;

providing a printed authorization and passcode with said mailing, wherein the passcode is derived from the consumer'"'"'s bank account information or recurring debt obligation information, where the recurring debt obligation is related to said solicitation;

said consumer placing a telephone call to a marketing organization at a telephone number that accompanied said solicitation or alternatively accessing a specified Web site if said consumer decides to accept an offer that accompanied said solicitation, said offer requiring said consumer'"'"'s preauthorization of electronic fund transfers from said consumer'"'"'s bank account;

said consumer providing said passcode printed on said solicitation to said marketing organization to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization;

said marketing organization attempting to verify said passcode; and

said marketing organization completing a transaction with said consumer based upon the terms of the offer that accompanied said solicitation if said passcode is successfully verified;

wherein said consumer has preauthorized electronic fund transfers from said consumer'"'"'s bank account without said marketing organization representative obtaining actual written authentication from said consumer; and

the solicitation relates to a financial product involving the recurring debt obligation of the consumer and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the consumer'"'"'s recurring payday period for payment against the consumer'"'"'s debt obligation, such that one or more additional payday periods occur after payment against the recurring debt are made according to the schedule and are used for additional payment against the debt.

2. The method of claim 1, wherein said solicitation comprises:

a direct marketing program for a financial product.

3. The method of claim 2, wherein said financial product is a mortgage acceleration program.

4. The method of claim 1, wherein said authorization and passcode comprise:

an ACH authorization and passcode.

5. The method of claim 1, wherein said passcode complies with the similarly authenticated requirement of the Electronic Funds Transfer Act (EFTA).

6. The method of claim 3, wherein said mortgage acceleration program withdraws funds electronically from said consumer'"'"'s checking or savings account via the ACH system according to a consumer specified or preferred pattern and makes monthly mortgage payments and accelerated mortgage payments to a mortgage servicer.

7. The method of claim 3, wherein said solicitation comprises:

a personalized letter to said consumer which articulates said consumer'"'"'s specific mortgage information and which describes potential benefits which said consumer could realize by joining said program.

8. The method of claim 3, wherein said solicitation includes an Enroll By Phone section that provides said consumer with a toll free telephone number that may be called to enroll in said program;

and wherein said Enroll By Phone section also includes an Enrollment Passcode.

9. The method of claim 3, wherein said solicitation includes a form of contract that specifies terms and conditions of an agreement that said consumer enters into by providing said passcode to said telemarketing organization representative.

10. A system for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from said consumer, comprising:

a computer configured to generate a passcode, wherein the passcode is derived from the consumer'"'"'s bank account information or a recurring debt obligation information, where the recurring debt obligation is related to said solicitation;

a printed solicitation including a printed authorization and said passcode, said solicitation conveying an offer to said consumer that requires said consumer'"'"'s preauthorization of electronic fund transfers from said consumer'"'"'s bank account;

a mailing house for mailing said printed solicitation to said consumer;

a marketing organization, wherein said consumer places a telephone call to said marketing organization at a telephone number that accompanied said solicitation or alternatively accessing a specified Web site if said consumer decides to accept said offer;

wherein said consumer provides said passcode printed on said solicitation to a representative of said marketing organization to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization;

wherein said marketing organization representative attempts to verify said passcode;

wherein said marketing organization completes a transaction with said consumer based upon the terms of said offer if said passcode is successfully verified; and

wherein said consumer has preauthorized electronic fund transfers from said consumer'"'"'s bank account without said marketing organization obtaining actual written authentication from said consumer and the solicitation relates to a financial product involving the recurring debt obligation of the consumer and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the consumer'"'"'s recurring payday period for payment against the consumer'"'"'s debt obligation, such that one or more additional payday periods occur after payment against the recurring debt are made according to the schedule and are used for additional payment against the debt.

11. The system of claim 10, wherein said solicitation comprises:

a direct marketing program for a financial product.

12. The system of claim 11, wherein said financial product is a mortgage acceleration program.

13. The system of claim 10, wherein said authorization and passcode comprise:

an ACH authorization and passcode.

14. The system of claim 10, wherein said passcode complies with the similarly authenticated requirement of the Electronic Funds Transfer Act (EFTA).

15. The system of claim 12, wherein said mortgage acceleration program withdraws funds electronically from said consumer'"'"'s checking or savings account via the ACH system and makes monthly mortgage payments and accelerated mortgage payments to said consumer'"'"'s mortgage servicer.

16. The system of claim 12, wherein said solicitation comprises:

a personalized letter to said consumer which articulates said consumer'"'"'s specific mortgage information and which describes potential benefits which said consumer could realize by joining said program.

17. The system of claim 12, wherein said solicitation includes an Enroll By Phone section that provides said consumer with a toll free telephone number that may be called to enroll in said program;

and wherein said Enroll By Phone section also includes an Enrollment Passcode.

18. The system of claim 12, wherein said solicitation includes a form of contract that specifies terms and conditions of an agreement that said consumer enters into by providing said passcode to said telemarketing organization representative.

19. A process for enrolling a consumer in a financial services program, comprising the steps of:

using financial data relating to said consumer to generate a mail piece to which personalization is applied to produce a benefit chart which illustrates actual benefits conferred upon said consumer by enrollment in said program;

using said financial data to generate a unique passcode that identifies said consumer in a secure and reliable fashion, wherein the passcode is derived from the consumer'"'"'s bank account information or a recurring debt obligation information, where the recurring debt obligation is related to said financial data;

merging said mail piece with said passcode, such that said passcode is printed on said mail piece;

generating a mail stream;

storing an image of said mail stream to preserve a client record of each solicitation;

generating a mailing to said consumer from said mail stream;

said consumer proceeding with program enrollment processing using said passcode that accompanied said mail piece by dialing a telephone number that accompanies said mail piece and providing said passcode to a telemarketer to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization;

said telemarketer entering said passcode into a system, wherein a passcode stored in said client record for said consumer is retrieved and compared to said passcode provided by said consumer;

said telemarketer gathering any remaining enrollment data that may be necessary to complete said enrollment process if a passcode match is ascertained by said telemarketer;

uploading said transaction to a payment processing system; and

confirming said consumer'"'"'s enrollment is said program with said consumer;

wherein the financial services program relates to the recurring debt obligation of the consumer and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the consumer'"'"'s recurring payday period for payment against the consumer'"'"'s debt obligation, such that one or more additional payday periods occur after payment against the recurring debt are made according to the schedule and are used for additional payment against the debt.

20. The process of claim 19, wherein said passcode is encrypted to secure the passcode against unauthorized use;

and wherein said passcode is stored for later use during an enrollment cycle.

21. The process of claim 19, wherein said mailing that includes an ACH authorization and passcode.

22. The process of claim 19, wherein said consumer is given an opportunity to review said passcode if said passcode provided by said consumer does not match a passcode stored in said system for said consumer.

23. The process of claim 19, wherein said mail piece is merged with said passcode in such fashion that the identity of said consumer is verified from said passcode when said passcode is presented to said telemarketer by said consumer.

24. An apparatus for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from said consumer, comprising:

a computer configured to generate an authorization and passcode, wherein said passcode complies with the similarly authenticated requirement of the Electronic Funds Transfer Act (EFTA), and wherein said passcode is derived from the consumer'"'"'s bank account information or a recurring debt obligation information, where the recurring debt obligation is related to said solicitation; and

a printed solicitation, wherein said solicitation conveys an offer to said consumer that requires said consumer'"'"'s preauthorization of electronic fund transfers from said consumer'"'"'s bank account, said printed solicitation comprising;

a personalized letter to said consumer which articulates said consumer'"'"'s specific financial information and which describes potential benefits which said consumer could realize by accepting said offer;

wherein said solicitation includes an enroll by phone section that provides said consumer with a telephone number that may be called to accept said offer;

wherein said enroll by phone section also includes said passcode; and

wherein said solicitation includes a form of contract that specifies terms and conditions of an agreement that said consumer enters into by providing said passcode to a marketing organization representative to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization, and the solicitation relates to a financial product involving the recurring debt obligation of the consumer and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the obligation, such that one or more additional payday periods occur after payment against the recurring debt are made according to the schedule and are used for additional payment against the debt.

25. The apparatus of claim 24, further comprising:

a mailing house for mailing said printed solicitation to said consumer;

a telemarketing organization, wherein said consumer places a telephone call to said telemarketing organization at a telephone number that accompanied said solicitation if said consumer decides to accept said offer;

wherein said consumer repeats said passcode printed on said solicitation to a representative of said telemarketing organization during the progress of said telephone call;

wherein said telemarketing organization representative attempts to verify said passcode;

wherein said telemarketing organization representative completes a transaction with said consumer based upon the terms of said offer if said passcode is successfully verified; and

wherein said consumer has preauthorized electronic fund transfers from said consumer'"'"'s bank account without said telemarketing organization representative obtaining actual written authentication from said consumer.

26. A method for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from said consumer, comprising the steps of:

mailing a printed solicitation to a consumer, wherein said solicitation comprises a direct marketing program for a financial product, wherein said financial product is a mortgage acceleration program, wherein said mortgage acceleration program withdraws funds electronically from said consumer'"'"'s checking or savings account via the ACH system and makes monthly mortgage payments and accelerated mortgage payments to a mortgage servicer, wherein said solicitation comprises a personalized letter to said consumer which articulates said consumer'"'"'s specific mortgage information and which describes potential benefits which said consumer could realize by joining said program, wherein said solicitation includes an Enroll By Phone section that provides said consumer with a toll free telephone number that may be called to enroll in said program; and

wherein said Enroll By Phone section also includes an Enrollment Passcode, wherein said solicitation includes a form of contract that specifies terms and conditions of an agreement that said consumer enters into by providing said passcode to said marketing organization representative;

providing a printed authorization and passcode with said mailing, wherein said authorization and passcode comprise an ACH authorization and passcode, wherein said passcode complies with the similarly authenticated requirement of the Electronic Funds Transfer Act (EFTA), and wherein said passcode is derived from the consumer'"'"'s bank account information or the consumer'"'"'s mortgage account information;

said consumer placing a telephone call to a marketing organization at a telephone number that accompanied said solicitation if said consumer decides to accept an offer that accompanied said solicitation, said offer requiring said consumer'"'"'s preauthorization of electronic fund transfers from said consumer'"'"'s bank account;

said consumer repeating said passcode printed on said solicitation to a representative of said marketing organization during the progress of said telephone call to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization;

said marketing organization representative attempting to verify said passcode; and

said marketing organization representative completing a transaction with said consumer based upon the terms of the offer that accompanied said solicitation if said passcode is successfully verified;

wherein said consumer has preauthorized electronic fund transfers from said consumer'"'"'s bank account without said marketing organization representative obtaining actual written authentication from said consumer, and wherein the solicitation relates to a financial product involving the consumer the consumer'"'"'s mortgage account and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the consumer'"'"'s recurring payday period for payment against the consumer'"'"'s mortgage debt, such that one or more additional payday periods occur after payment against the mortgage debt are made according to the schedule and are used for additional payment against the mortgage debt.

27. A system for preauthorizing electronic fund transfers from a consumer'"'"'s bank account without obtaining actual written authentication from said consumer, comprising:

a computer configured to generate a printed authorization and passcode, wherein said passcode is derived from the consumer'"'"'s bank account information or the consumer'"'"'s mortgage account information;

a memory associated with said computer configured to store the printed authorization and passcode;

a printed solicitation including said printed authorization and passcode, wherein said authorization and passcode comprise an ACH authorization and passcode, wherein said passcode complies with the similarly authenticated requirement of the Electronic Funds Transfer Act (EFTA), said solicitation conveying an offer to said consumer that requires said consumer'"'"'s preauthorization of electronic fund transfers from said consumer'"'"'s bank account;

said printed solicitation comprising a personalized letter to said consumer which articulates said consumer'"'"'s specific mortgage information and which describes potential benefits which said consumer could realize by joining said program, wherein said solicitation includes an Enroll By Phone section that provides said consumer with a toll free telephone number that may be called to enroll in said program; and

wherein said Enroll By Phone section also includes an Enrollment Passcode, wherein said solicitation includes a form of contract that specifies terms and conditions of an agreement that said consumer enters into by providing said passcode to said marketing organization representative;

a mailing house for mailing said printed solicitation to said consumer, wherein said solicitation comprises a direct marketing program for a financial product, wherein said financial product is a mortgage acceleration program, wherein said mortgage acceleration program withdraws funds electronically on a payday-to-payday basis from said consumer'"'"'s checking or savings account via the ACH system and makes monthly mortgage payments ad accelerated mortgage payments to said consumer'"'"'s mortgage servicer;

a marketing organization, wherein said consumer places a telephone call to said marketing organization at a telephone number that accompanied said solicitation if said consumer decides to accept said offer;

wherein said consumer repeats said passcode printed on said solicitation to a representative of said marketing organization during the progress of said telephone call to thereby provide authentication of preauthorizing of electronic funds transfers from the consumer'"'"'s bank account without giving actual written authentication of said preauthorization;

wherein said marketing organization representative attempts to verify said passcode;

wherein said marketing organization representative completes a transaction with said consumer based upon the terms of said offer if said passcode is successfully verified; and

wherein said consumer has preauthorized electronic fund transfers from said consumer'"'"'s bank account without said marketing organization representative obtaining actual written authentication from said consumer, and wherein the solicitation relates to a financial product involving the consumer the consumer'"'"'s mortgage account and a recurring payday period of the consumer, wherein the preauthorized electronic fund transfers involve a payday-to-payday schedule of allocating funds from the consumer'"'"'s recurring payday period for payment against the consumer'"'"'s mortgage debt obligation, such that one or more additional payday periods occur after payment against the mortgage debt are made according to the schedule and are used for additional payment against the mortgage debt.